RR, perhaps I can provide some colour to this. I've shown before how our sales to China has diminished with time (from ~60ish% of revenue in our early operations to ~33ish % i the last few years), but China is still an important customer for us. Predominantly we sell separated Nd and Pr oxides as well as SEG to China.
I've not tracked this for a while though, so out of curiosity I trawled my data for more recent trends:
A couple of notes: - Per quarter, we were in the mid-30ish ballpark up until FY23Q1 (July-Aug 2022). After this, we have reduced sales to China - after October last year, we have been trending down to low 20ish%. This corresponds with AL's comment regarding stockpiling SEG while waiting for higher prices.
- An important exception to the above paragraph is June 2023. We suddenly sold a much larger % to China. Why (?) one might ask. I believe it's strategic - I previously thought LYC would release NdPr stockpile prior to the end of the last quarter. Now I'm pretty certain we instead released SEG stockpile as the price for heavies have recovered more, and that we instead have potentially further increased our NdPr stockpile as a reserve for the coming quarters (as Kal comes online). If correct, this would be very significant for the revenue in the coming quarters.
- If the above point is correct, when the inventory should increase in the FY23 financial report (next month).
- To answer your question regarding Chinese EVs. Yes, likely our heavies ends up in Chinese EVs (i.e. from our SEG).
DYOR
LYC Price at posting:
$6.56 Sentiment: Buy Disclosure: Held
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